Firm trade prevails; Sensex surpasses 21,000 mark

Indian equities added gains to continue firm trade hovering near the highest point of the day in the late afternoon session on account of buying in frontline counters and taking cues from European counterparts. Traders were seen piling position in Realty, Health Care and Bankex stocks while selling was witnessed in Metal, Auto and Oil & Gas sector stocks. In scrip specific development, Havells India was trading firm after it reported 44.55% rise in its net profit after tax at Rs 125.72 crore for the quarter ended September 30, 2013 as compared to Rs 86.97 crore for the same quarter in the previous year. Financial Technologies (India) and Multi Commodity Exchange of India (MCX) were trading in green after NSEL stated that Mohan India has agreed to arrange for Rs 771 crore as final settlement. Larsen & Toubro (L&T) was trading in red after foreign brokerage firm downgraded the company to neutral from overweight stating that the current share price adequately discounts near-term positives. The market may remain volatile as traders may roll over positions in the Futures & Options (F&O) segment from the near month i.e. October 2013 series to next month i.e. November 2013 series. The near month October 2013 derivatives contract expires tomorrow i.e. October 31, 2013.

On the global front, all the Asian markets were trading in green barring Jakarta Composite and KLSE Composite while the European markets were too trading on optimistic note. Back home, the NSE Nifty and BSE Sensex were trading above their psychological 6,250 and 21,000 levels respectively. The market breadth on BSE was positive in the ratio of 1173:1050 while 168 scrips remained unchanged.

The BSE Sensex is currently trading at 21063.38 up by 134.37 points or 0.64% after trading in a range of 21068.65 and 20937.12. There were 21 stocks advancing against 9 declines on the index.

The broader indices were too trading in green; the BSE Mid cap index was up by 0.54%, while Small cap index up by 0.86%.

The gaining sectoral indices on the BSE were Realty up by 1.50%, Health Care up by 1.24%, Bankex up by 0.94%, TECK up by 0.93% and Power up 0.82%. While, Metal down by 0.21% and Auto down by 0.13% were the only losers on BSE.

The top gainers on the Sensex were Bharti Airtel up by 6.40%, Dr. Reddy’s Lab up by 3.14%, BHEL up by 2.93%, ICICI Bank up by 2.63% and Bajaj Auto up by 2.08%. On the flip side, SSLT down by 1.89%, Wipro down by 1.79%, M&M down by 1.14%, L&T down by 0.52% and Tata Motors down by 0.52% were the top losers on the Sensex.

Meanwhile, the coal block auction to private firms is likely to get delayed to March next year from December, 2013 as the government has enhanced the action target to 10 blocks from 6 coal blocks planned earlier. Coal Ministry has asked CMPDIL, the mine planning and consultancy company of Coal India, to assess the reserves of four more coal mines and submit its report by the next year. The government wants to allot coal blocks to private players in order to kickstart coal mining in a public-private partnership (PPP) mode in the country.

Further, the move will help to enhance country’s coal production for meeting India’s growing coal demand and will also end the monopoly of public sector unit Coal India. In July, the government had earlier allocated 14 coal mines to central and state public sector units, including four to NTPC.

In the previous month, the government has approved the new methodology for auctioning coal blocks in order to provide upfront and production-linked payments and benchmarking of coal sale prices. The move will ensure greater transparency in auctioning the fully explored coal blocks and will also enable the government to allot coal mining licences through competitive bidding for the first time. The government will put coal blocks for auction after the environment ministry reviews and bidders approval to a minimum work programme.

According to the new methodology, bidders have to provide production-linked payment on rupee per tonne basis, plus a basic upfront payment of 10 percent of the intrinsic value of the coal block. Meanwhile, intrinsic value will be calculated based on net present value (NPV) of the block arrived through the discounted cash flow (DCF) method. The CNX Nifty is currently trading at 6,259.40 up by 38.50 points or 0.62% after trading in a range of 6,262.70 and 6,222.60. There were 37 stocks advancing against 13 declines on the index.

The top gainers of the Nifty were Bharti Airtel up by 6.45%, IndusInd Bank up by 3.70%, Dr. Reddy’s Lab up by 3.21%, BHEL up by 3.04% and ICICI Bank up by 2.69%. On the flip side, SSLT down by 1.97%, Wipro down by 1.76%, M&M down by 1.40%, Ultratech Cement down by 1.19% and Ambuja Cement down by 0.79% were the major losers on the index.

Most of the Asian equity indices were trading in green; Taiwan Weighted up by 0.52%, Seoul Composite up by 0.38%, Straits Times up by 0.52%, Nikkei 225 up by 1.23%, Shanghai Composite up by 1.48% and Hang Seng up by 2.00%, while Jakarta Composite down by 0.20% and KLSE Composite down by 0.01%. 

The European markets were trading in green; France’s CAC 40 was up 0.64%, Germany’s DAX gained 0.23% and UK’s FTSE 100 was up 0.40%.